nitulbhatia
Legend
Bronze Level
Its interesting to know what goes on behind the scenes of an online poker site. Here is some information on purple lounge which has shut for business and not paid back player deposits:
Half year results have just been published showing that the company has barely £500k left in cash. Operating costs are being covered by a secured loan from Barclay’s Bank for £750k at an interest rate of 10% over the bank’s base lending rate.
The figures show an operating loss of £1.3m over the last 6 months. The company sold two web sites earlier this year, and has reported an exceptional gain of £265k. This takes the effective operating loss to £1.6m.
This is a company which is losing £264k a month with only £500k in the bank plus a £750k loan. It will run out of money in well under 6 months unless it can reduce costs immediately and/or raise new investment. An analysis of its portfolio of brands shows that there is little hope of it earning enough cash to cover this rate of losses.
If Media Corp does go busto, it has some assets. The half year results show total assets of £4.5m and total liabilities of £2.7m. In accounting terms, the company has a net asset value of £1.8m.
However, £2.9m of the assets are listed as “Intangibles”—They consist of items such as “goodwill” and the value of the Purple Lounge brand and intellectual property such as copyrights. Poker players will probably put a lower value on the Purple Lounge intangibles than the accountants do. If the intangible assets are removed from the accounts, Media Corp has assets of £1.6m and liabilities of £1.8m.
Having watched the share price collapse by 85% in the last 15 months shareholders are, if anything, more angry than poker players about this debacle.
Source: http://pokerfuse.com/features/comme...rple-lounge-closed-community-demands-answers/
Half year results have just been published showing that the company has barely £500k left in cash. Operating costs are being covered by a secured loan from Barclay’s Bank for £750k at an interest rate of 10% over the bank’s base lending rate.
The figures show an operating loss of £1.3m over the last 6 months. The company sold two web sites earlier this year, and has reported an exceptional gain of £265k. This takes the effective operating loss to £1.6m.
This is a company which is losing £264k a month with only £500k in the bank plus a £750k loan. It will run out of money in well under 6 months unless it can reduce costs immediately and/or raise new investment. An analysis of its portfolio of brands shows that there is little hope of it earning enough cash to cover this rate of losses.
If Media Corp does go busto, it has some assets. The half year results show total assets of £4.5m and total liabilities of £2.7m. In accounting terms, the company has a net asset value of £1.8m.
However, £2.9m of the assets are listed as “Intangibles”—They consist of items such as “goodwill” and the value of the Purple Lounge brand and intellectual property such as copyrights. Poker players will probably put a lower value on the Purple Lounge intangibles than the accountants do. If the intangible assets are removed from the accounts, Media Corp has assets of £1.6m and liabilities of £1.8m.
Having watched the share price collapse by 85% in the last 15 months shareholders are, if anything, more angry than poker players about this debacle.
Source: http://pokerfuse.com/features/comme...rple-lounge-closed-community-demands-answers/